7/03/2012

Greece plea amid 'alarming' data

Greece’s new government will present “alarming” data on its recession and unemployment to international debt inspectors this week in a bid to renegotiate the terms of its bailout agreements, a spokesman said.

Simos Kedikoglou said in a television interview that the data would demonstrate that the current austerity programme was counterproductive.

Greece is relying on rescue loans from its partners in the eurozone and the International Monetary Fund (IMF) to avoid bankruptcy. In exchange, it has made painful austerity cuts such as tax hikes and cuts to public sector jobs, pensions and salaries.

Along with uncertainty over the country’s finances, those austerity measures have hit the economy hard – it is in a fifth year of recession, with unemployment topping 22%, roughly double the eurozone average.

The Greek government will argue that it cannot withstand the current pace of austerity terms.

Debt inspectors from the European Commission, the European Central Bank and the IMF are due in Athens tomorrow.

“We will present information that is astounding. It is alarming in terms of the recession and unemployment, and it shows beyond any doubt that the current policy does not bring results. It brings the opposite results,” Mr Kedikoglou told private Antenna television.

Conservative prime minister Antonis Samaras has promised to seek more time to meet the deficit reduction targets after winning a general election last month and joining traditional rival Socialists in a coalition government.

Evangelos Venizelos, the Socialist leader, told a financial conference today that a renegotiation of bailout terms was inevitable.

“Greece, regardless of which government represents it, cannot remain indifferent to this deep recession ... that is approaching an aggregate 20% of gross domestic product. No government can remain indifferent to an unemployment rate that exceeds 22% and 55% among young people,” he said.

“The extension of the economic adjustment programme is the cornerstone of the country’s strategy and of the basis of the coalition government’s co-operation.”

Rescue creditors have so far appeared cool to the idea of extending Greece’s deficit reduction deadlines.

On Monday, a senior official from the European Central Bank, Joerg Asmussen, warned that lengthening the programme would simply put off unavoidable reforms and could threaten efforts to make Greek national debt sustainable.